Australia’s iron ore export earnings are forecast to decline to A$120 billion in 2023-2024 from A$124 billion in 2022-2023 and to A$99 billion in 2024-25, due to lower prices over the outlook period, according to the quarterly outlook report by the Australian government’s Department of Industry, Science and Resources.
The export earnings forecast for the fiscal year 2023-24 has been revised up from A$110 billion in the previous report, reflecting a lower-than-expected exchange rate, slightly higher prices and a small increase in volumes.
Even though iron ore prices fluctuated in the April-September quarter, they have generally moderated since the beginning of this year, due to slowing global economic growth and weakness in the Chinese property sector. Following a strong rebound in iron ore prices to a peak of over US$120/mt in the June quarter, the benchmark iron ore spot price fell to around US$108/mt in August this year. The price falls reflect slackened demand from Chinese mills.
The report pointed out that the benchmark iron ore price is projected to average around US$100/mt in 2023, around US$84/mt in 2024 and around US$76/mt in 2025.